Cosatu was aware of firm’s troublesComment on this story
Johannesburg - Cosatu entrusted Kopano Ke Matla to conclude its property transactions, despite its investment company being under investigation by the Financial Services Board (FSB) for misappropriating pensioners’ money.
Correspondence between Cosatu, the FSB and Kopano chief executive Collin Matjila shows that the federation was aware of Kopano’s troubles at the time it handed over the deals in 2011.
Cosatu lost up to R16 million in the sale of its old headquarters and the purchase of its new one in Braamfontein, Joburg.
According to a forensic report into the building deal as well as the handling of an FSB report involving Kopano, it was requested to assist with the sale and acquisition process, based on its knowledge and experience, in 2010.
Later that year, the FSB started investigating Kopano Financial Services, a subsidiary of Kopano, for failing to meet the requirements it needed to have its own administration system.
Eventually, investigations showed that millions of rand were plundered from the employee provident fund through various entities.
Cosatu’s lax oversight over its investment firm compromises its strident anti-corruption stance, which has put it at loggerheads with the government and the private sector.
The federation launched Corruption Watch, an anti-corruption watchdog, in 2011 and encouraged workers to blow the whistle on graft in their workplaces and even inside their own unions.
The exposé of large-scale misappropriation of funds inside its own investment company, and the federation’s seeming inability to act against it, will now weaken the initiative even further.
The forensic investigation by SizweNtsalubaGobodo was ordered by Cosatu last year.
It alleges that Matjila, who now heads up power utility Eskom, sat on the damning information that came out of the FSB investigations and initially shared only a summary of the FSB’s report when asked for it by Cosatu general secretary Zwelinzima Vavi. Critically, the summary report did not contain the full details of the malfeasance at Kopano, which had been uncovered by the FSB.
Matjila was given a hard copy of the FSB report in 2012, and in that report the investigators mention a more detailed electronic copy from 2011 that was submitted on the same day as the 2012 summary document.
“It appears that the FSB report dated December 6, 2011 was not dealt with in an open and transparent manner by Mr Matjila. The report was not circulated to Cosatu when it was received, despite the fact that it was received by Kopano Ke Matla on the same day as the one dated April 16, 2012. This appears to be irregular,” the document reads.
The auditors have now advised Cosatu to seek legal advice on what action to take against Matjila for his apparent failure to handle the 2011 FSB report in an open and transparent manner. They also say the federation should investigate Kopano’s alleged misappropriation of funds as suggested by the FSB report.
Cosatu has not yet decided what to do regarding these allegations. A Cosatu leader told The Star an investment council meeting would be held later this year to “look into everything”.